SUR : Financial results announcement and cash dividend declaration for the year ended 30 June 2019: https://senspdf.jse.co.za/documents/2019/jse/isse/sur/SpurYE2019.pdf
Financial results announcement and cash dividend declaration for the year ended 30 June 2019
Spur Corporation Ltd
(registration number 1998/000828/06)
Share code: SUR
ISIN: ZAE000022653
REVIEWED GROUP RESULTS FOR THE YEAR ENDED 30 JUNE 2019
Revenue Up 5.9%
Comparable profit before income tax Up 15.9%
Earnings per share Up 7.3% to 173.69 cents
Headline earnings per share Up 10.8% to 173.68 cents
Dividend per share Up 10.6% to 136 cents
Net asset value per share Up 3.6%
TRADING PERFORMANCE
Spur Corporation posted a resilient performance as total franchised restaurant sales increased by 7.2% to R7.6 billion.
Trading conditions continue to be challenging in the low growth domestic market while the group's international business
was impacted by the weak economy and high operating costs in Australia.
The group's trading results reported in this commentary exclude the Captain DoRegos chain which was sold with effect from
1 March 2018.
Franchised restaurant sales in South Africa grew by 6.2%. After increasing local restaurant sales by 11.3% and 1.3% in the
first and second quarters of the financial year respectively, the group reported growth of 7.5% in the third quarter and
6.0% in the fourth quarter.
Spur Steak Ranches increased restaurant sales by 5.4%, supported by the loyal customer base of over 1.2 million active
Spur Family Card members. Restaurant sales in Pizza and Pasta, incorporating Panarottis and Casa Bella, grew by 0.9% as
the Panarottis chain continued to be impacted by aggressive discounting by competitors in the takeaway pizza market.
RocoMamas grew restaurant sales by 7.5% as an increased investment in marketing saw the brand return to positive existing
business growth in the second half of the year, following a decline in the first half. John Dory's increased restaurant
sales by 4.6%, benefiting from the reopening of two major outlets which were temporarily closed due to shopping mall
redevelopment. The Hussar Grill's higher income customers continue to be resilient and the brand grew restaurant sales by
13.4%.
The group acquired a 51% shareholding in the Nikos Coalgrill Greek chain, which comprised six restaurants at the effective
date of 1 August 2018. The chain contributed franchised restaurant sales of R65.9 million for the 11 months since
acquisition.
New restaurant openings contributed to international restaurant sales increasing by 12.3% on a constant exchange rate
basis and by 16.2% in Rand terms. Trading in Africa, Mauritius and the Middle East remains strong. Restaurant trading
conditions in Australia and New Zealand continue to be impacted by high operating costs, escalating rentals and declining
disposable income, with sales declining by 15.9% following the closure of three restaurants.
Following the opening of a net 39 outlets during the year, and the acquisition of the Nikos brand, the group's restaurant
base increased to 620, of which 77 are located outside of South Africa.
FINANCIAL PERFORMANCE
Group revenue increased by 5.9% to R944.8 million, with revenue generated in South Africa increasing by 5.7% and
international revenue by 10.3%.
Following the adoption of IFRS 15, the marketing fund contributions paid by franchisees are now recognised as revenue on
the same basis as franchise fee revenue. Revenue of R252.4 million (2018: R239.7 million) has been recognised from
marketing fund contributions.
Profit before income tax increased by 13.9% while comparable profit before income tax, excluding exceptional and one-off
items, increased by 15.9%.
Headline earnings increased by 10.2% to R165.1 million, with diluted headline earnings per share 10.7% higher at 173.2
cents.
PROSPECTS
The group expects trading conditions to remain constrained in the short to medium term against the background of low
economic growth, the weak labour market, fragile consumer confidence and continued pressure on household budgets. In this
environment, management will maintain its focus on tight cost management, excellent product quality and the profitability
of franchisees.
In the year ahead the group plans to open at least 11 restaurants in South Africa and 10 internationally.
CASH DIVIDEND
Shareholders are advised that the board of directors of the company has, on Wednesday, 11 September 2019, resolved to
declare a final gross cash dividend for the year to 30 June 2019 of R79.191 million, which equates to 73 cents per share
for each of the 108 480 926 shares in issue, subject to the applicable tax levied in terms of the Income Tax Act (Act No.
58 of 1962), as amended ("dividend withholding tax") of 20%.
The dividend has been declared from income reserves. The net dividend is 58.4 cents per share for shareholders liable to
pay dividend withholding tax. The company's income tax reference number is 9695015033. The company has 108 480 926
shares in issue at the date of declaration.
In accordance with the provisions of Strate, the electronic settlement and custody system used by the JSE Limited, the
relevant dates for the dividend are as follows:
Event Date
Last day to trade 'cum dividend' Tuesday, 1 October 2019
Shares commence trading 'ex dividend' Wednesday, 2 October 2019
Record date Friday, 4 October 2019
Payment date Monday, 7 October 2019
Those shareholders of the company who are recorded in the company's register as at the record date will be entitled to the
dividend.
Share certificates may not be dematerialised or rematerialised between Wednesday, 2 October 2019 and Friday, 4 October
2019, both days inclusive.
For and on behalf of the board
MJ Bosman (Chairman)
P Van Tonder (Group Chief executive officer)
12 September 2019
This short-form announcement is a summary of the information contained in the detailed results announcement which is
available at https://senspdf.jse.co.za/documents/2019/jse/isse/SUR/SpurYE2019.pdf and on the company's website
at www.spurcorporation.com/investors/results-centre/. The full announcement is available for inspection, at no charge, at
the company's registered office and at the offices of Sasfin Capital (29 Scott Street, Waverley, Johannesburg) and copies
may be requested from the company's registered office during business hours. Any investment decision in relation to the
company's shares should be based on the full announcement.
This short-form announcement is the responsibility of the board of directors and has been prepared under the supervision
of the chief financial officer, Phillip Matthee CA(SA).
Date: 12/09/2019 09:00:00
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